Low-Priced Supplies Dwindle, Prices Rise Slightly; Supply-Demand Imbalance in Stainless Steel Market Awaits Resolution [[SMM Daily Review of Stainless Steel Spot Cargo]]

SMM reported on April 30 that today, SS futures continued their previous fluctuating trend in the doldrums. As the Labour Day holiday approached, the market did not witness the expected pre-holiday stockpiling frenzy, with all parties maintaining a cautious wait-and-see attitude. Currently, transactions are mainly concentrated on low-priced warrant cargoes, with most other purchases driven by rigid demand. It is worth noting that as stainless steel prices reached relatively low levels, the resistance to further declines significantly increased. Coupled with the gradual depletion of low-priced cargoes, market prices have shown signs of a slight rebound.

In the futures market, the most-traded 2506 contract was trading in a weak and fluctuating manner. At 10:30 a.m., SS2506 was quoted at 12,655 yuan/mt, down 30 yuan/mt from the previous trading day. In the Wuxi region, the spot premiums/discounts for 304/2B stainless steel ranged from 415 to 615 yuan/mt. In the spot market, cold-rolled 201/2B coils in both Wuxi and Foshan were quoted at 8,100 yuan/mt. For cold-rolled trimmed 304/2B coils, the average price in Wuxi was 13,000 yuan/mt, and the same in Foshan. Cold-rolled 316L/2B coils were priced at 23,750 yuan/mt in Wuxi and 23,750 yuan/mt in Foshan. Hot-rolled 316L/NO.1 coils were quoted at 22,975 yuan/mt in both regions. Cold-rolled 430/2B coils were priced at 7,500 yuan/mt in both Wuxi and Foshan.

From the perspective of market fundamentals, the current stainless steel prices have led to significant losses in the stainless steel sector. Additionally, the prices of furnace charges such as nickel and chromium have remained relatively firm, highlighting the prominent cost-supporting effect. However, the overall production cuts in the industry have been insufficient, with production being maintained more through adjustments in steel grade structures, resulting in an insignificant contraction effect on the supply side. On the demand side, impacted by the US tariff policies, downstream enterprises hold pessimistic expectations and are increasingly cautious in their procurement behaviors. Despite prices being at low levels, market transactions have not significantly improved, with weak demand remaining the core imbalance constraining the recovery of the stainless steel market.